STARTING A BONE CHINA BUSINESS IN UGANDA
Bone China porcelain products are decorative products that are used by a range of consumers especially hotels, recreation centers, events management enterprises, office and home decoration enterprises etc.
The targeted output for the project is 39,936 pieces of high quality bone china porcelain products produced annually requiring an estimated fixed capital of US$ 43,602, operating costs of US$ 89,548, realizing estimated revenue of US$ 143,770, in the first year of operation. The projected net profit margin is at 38% and having a payback period of 3 years.
Capital Investment Requirements in US$ Production Capacity, Technology and Process
|Capital Investment Item||Units||Qty||@||Total|
|Land and Buildings||No||–||–||16,000|
|Hammer & Ball Mills||No||2||1,270||2,540|
|Wheel throwing machine||No||2||1,900||3,800|
|Furniture & Fittings||No||–||2,500||2,500|
The manufacturing process involves the following stages;
The raw materials such as: clay, feldspar, silica, stone dust, are first crushed using jaw crushers, hammer mills or ball mills.
they are cleaned to remove improperly sized materials, and later passed into a mixer to mix the cleaned materials.
Using the soft plastic method of production, the materials are shaped by manual molding, jiggering or ram pressing, wheel throwing where the mixed material is put on the wheel and shaped while the wheel turns.
After shaping the materials, bisque firing takes place and here heating of the products is done at relatively low temperatures to vaporize volatile contaminants and minimize shrinkage during firing.
- The products are passed to an electric kiln where fifing takes place using high temperature ranging between 1,000 to 1,5000c.
- The products are left to cool and later packaged for selling and distribution.
- Production and Operating Costs in US$
(a)Direct Materials, Supplies and Costs
|Cost Item||Units||@||Qty/ day||Pdn cost/ day||Pdn cost/ mth||Pdn cost/yr|
|Clay &Stone dust||Kgs||0.028||128||3.6||93.1||1,118|
|Felspar Silica, vanaculanite||Kgs||18||7||126||3276||39,312|
|Water & Other materials||Kgs||0.005||4,000||20||520||6,240|
General costs (Overheads)
|Total Operating Costs||7,462||89,548|
- Production costs assumed are for 312 days per year with daily capacity of producing 128 pieces of bone china porcelain products.
- Depreciation (fixed asset write off) assumes 4-years life of assets written off at 25% per year for all assets.
- Direct costs include: materials, supplies and other costs that directly go into production of the product.
- Total monthly days assumed are 26-days.
- The valuation currency used is United States Dollars
Project Product Costs and Price Structure
|Bone China Porcelain||128||39,936||2.2||89,548||3.6||143,770|
Profitability Analysis Table
|Profitability Item||Per Day||Per Month||Per Year|
|Less: Production &Operating Costs||287||7,462||89,548|
The market for bone China porcelain exists in the country with major consumers such as: supermarkets, restaurants, wholesale shops and retail shops etc.